TMI Blog2005 (7) TMI 100X X X X Extracts X X X X X X X X Extracts X X X X ..... The judgment of the court was delivered by Rajes Kumar J.— The Income-tax Appellate Tribunal has referred the following questions of law under section 256(1) of the Income-tax Act, 1961 (hereinafter referred to as "the Act"), for the assessment years 1981-82 and 1982-83 for opinion of this court : "(a) Whether, on the facts and in the circumstances of the case, the Tribunal was correct in confirming the order of the Commissioner of Income-tax (Appeals) holding that the difference between the stock value shown in the books of account of the assessee and value disclosed to the bank was not assessable to tax as deemed income ? (b) Whether, on the facts and circumstances of the case, the Tribunal was correct in confirming the order of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 52,013 16,264 92,013 83,453 N. P 9,320 9,815 26,320 17,651 Total of balance-sheet 1,72,546 — 2,14,500 — 3. From the balance-sheet which was filed with the Union Bank of India, it was found by the Assessing Officer that stock of harrow and chaff cutter was of Rs. 82,325 and Rs. 25,638 for the assessment year 1981-82 and Rs. 63,700 and Rs. 24,361 for the assessment year 1982-83, while as per the balance-sheet submitted to the Department, the assessee showed closing stock respectively of Rs. 12,325 and Rs. 4,521 for the assessment year 1981-82 and Rs. 18,381 and Rs. 2,815 for the assessment year 1982-83. Thus, the Asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ibunal held as follows : "Rival submissions heard and relevant orders read including the case law relied upon by the parties as well as the concerned pages of the paper book, referred to before us. After doing so we note that the substance in the submission of the assessee has substantial force which was consequently rightly appreciated by the Appellate Commissioner. The Commissioner of Income-tax (Appeals) found that though, the balance-sheet was presented before the bank, neither the bank has physically verified and certified the stock available with the assessee nor even the Assessing Officer has gone to that extent to device and find out the measure to establish that the assessee did have the balance of stock of harrow and chaff cutte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll as on the decision reported in the case of India Motor Parts and Accessories P. Ltd. v. CIT [1966] 60 ITR 531 (Mad) wherein it was held that the figures furnished by the assessee to the State Bank of India for purposes of obtaining an overdraft are not concerned with the actual stock valuation for determining the trade results for purposes of ascertaining the profits and gains derived from that business and that, therefore, the addition made by the Assessing Officer was unsustainable. After proper appraisal of the facts and circumstances of the case in the light of the submissions made before us and after a perusal of the relevant pages of the paper book highlighted by the parties concerned as referred to above, we are of the conside ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me-tax (Appeals) and the Tribunal have accepted the explanation of the assessee that the inflated stock in the alleged balance-sheet submitted to the bank was to avail of higher credit facility. In our opinion, finding of the Tribunal is the finding of fact based on material on record and cannot be said to be perverse or without any material. The decision of this court relied upon by learned standing counsel in the case of Swadeshi Cotton Mill Co. Ltd. v. CIT [1980] 125 ITR 33 is not applicable to the present case. In the said case, the Income-tax Officer gathered information from the bank about the goods pledged and found that the goods pledged with the bank were in excess of the stock as per books and rejected the books. Discrepancies ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d correct. On this basis, the Income-tax Officer found suppression of stock to the extent of Rs. 5,04,137 in the accounts of the assessee. The assessee has not offered any explanation about the said discrepancies and, therefore, the difference in the amount has been added as a suppressed income. 9. We also not find any error in the order of the Tribunal granting renewal of registration to the firm. For the reasons stated therein, learned standing counsel is not able to point out any error in the order of the Tribunal in this regard. 10. In view of the aforesaid discussions, questions referred to us are answered in the affirmative, i.e., in favour of the assessee and against the Revenue. However, there shall be no order as to costs. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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